Pepco Delays Power Plant Construction

By William H. JonesBy William H. JonesJune 10, 1977

Potomac Electric Power Co., caught with excess capacity for generating electricity in an era of energy conservation adn slow economic expansion, yesterday announced further delays in construction for future power plants.

In the fourth major cuback of expansion plans announced by the Washington-based utility since early 1974, Pepco said:

Plans for a nuclear on the Potomac River, south of Washington in Charles County, will be "deferred indefinitely." pepco earlier had delayed the first of two 1,178-megawatt nuclear plants at Douglas Point to "not earlier" than 1987 and the second unit indefinitely.

Company chairman W. Reid Thompson emphasized yesterday that Pepco plans to retain the Maryland site for eventual constuction of the nuclear plant, "when the needs of our system require it."

Initial operation of an 800-megawatt, coal-fired fourth generating station at Dickerson, in Montgomery County, will be deferred from 1983 to 1985.

Morever, Pepco announced that the final Dickerson plant will be a joint venture with Baltimore Gas & Electric Co. The two utility firms will share construction and operation costs as well as electricity ultimately produced from the plant, estimated to cost $650 million.

A 600-megawatt, oil-fired fourth unit at Chalk Point, in southern Prine George's County, will be completed in 1982 instead of 1981.

The changes announced yesterday mean that Pepco's construction requirements for the 1977-1979 period have been slashed to $440 million from $590 million. For the five years 1977-1981, the company now plans to spend $775 million on new construction.

Three curtailments of expansions plans announced by the utility in 1974 had trimmed $1974-1977 spending by about half to $710 million.

Thompson said the new cutback is based on studies showing that "electric demand will grow even more slowly" than anticipated earlier this year, "primarily because of the expected impact of energy conservation efforts by our customers will be intensified by the administration's national energy plan proposals."

Five months ago, Pepco was projecting an annual growth in sales and peak demand of power of 3-5 per cent a year for the next decade; now, Pepco expects that growth to be close to 3 per cent annually.

Pepco is not alone among the countrys electric utilities in cutting back. About 30 nuclear plants have been delayed in more than a dozen states including Virginia, where Virginia Electric & Power Co. canceled outright two nuclear plants at its Surry location, planned for completion in 1986 and 1987, and delays for two plants at North Anna in Louisa County.

Baltimore Gas has put off earlier plans for a nuclear plant northeast of Baltimore, on the Chesapeake Bay at Perryman.

While utility industry leaders have continued to express their views that nuclear power is necessary to meet future electricity demands, several have blamed the political climate for their decision to avoid "risks" of new nuclear spending.

Pepco's decision todelay nuclear construction agains is not expected to million to date on the Douglas Point site and potential termination costs could be $30 million, the Pepco officer said total outlays would be more than offset by purchases of nuclear fuel supplies at "favorable" rates.

Virginia Electric touched off protests in that company's service area when it said losses of up to $146 million on the canceled nuclear plants would be passed on to consumers over 10 years.

Pepco serves the District, a small area of northern Virginia and the densely populated suburban Maryland communities. From the 1950s to the early 1970s, the Pepco region had grown at a rate faster than national averages but the energy crisis led to a sharp dip in consumption in 1974 - mainly because of government cut-blacks in power use.

[TEXT OMITTED FROM SOURCE] result in any costs or losses, Thompson said. While the firm has spent $35